Monday, June 20, 2011

I thought I had picked all the sugar snap peas on my flourishing vines. So I set the bag of peas aside and went on to pick lettuce and weed the peppers. But wait! When I turned around, I suddenly could see several peas that I had missed.

"Where did those come from?" I wondered.

Pea pods have the perfect camouflage. They are the exact same color as the vines and leaves. When I moved away from the vines, I could see things in a different light and from a different perspective. Pods that had been hidden by leaves or had previously blended in appeared. Suddenly, I could see what I had missed when I was up close, looking straight down or straight at the vines.

This made me think about life and business. Sometimes you really need to step back from what you're doing to see the hidden value. The bounty can be right there in front of you, but you're just too close to see it.

That's one reason companies hire consultants. When consultants come in, they are not caught up in the group-think of the organization. They can point out obvious sources of new revenue, discover forgotten assets, or reveal potential cost savings. They can uncover the hidden value by asking the right questions or just by seeing things from a different, outside perspective.

But I believe that you can do this for yourself. You just have to be willing to look at your business in a new light. Step back, bend down and look low. Go up high and look down. Step away and walk around. Try looking with new eyes and an open mind. Look with your customers' eyes. Look with investors' eyes. What is there that you haven't seen before?

Thursday, June 16, 2011

The Connecticut Venture Group has changed its name to Crossroads Venture Group, and it has a new website: www.cvg.org. I first learned of CVG in 1995, when I helped run the Business Formation Network at Norwalk Community College.

CVG has been instrumental in promoting venture funding in our state.

I've gone to their Crossroads Venture Fair, their networking events and their presentations for entrepreneurs. Every time, I learned something new and met amazing people -- investors, lawyers, accountants and potential clients. A few times, I was fortunate enough to attend their boot camps for entrepreneurs along with my clients. The boot camps were set up to help people know how to make a good pitch to investors.

A couple of times, I got to be a judge, screening the applications to present at the venture fair. That was absolutely fascinating. I couldn't believe how many people failed to follow directions when filling out their applications to present. It made me wonder if people were actually reading the questions.

Over time, the organization has morphed. In the dot-com boom, hundreds of people packed their conferences. And investors were willing to hear pitches from pre-revenue companies. But after the meltdown in 2000, investors became far more picky. And the Crossroads fair only allowed growth stage companies to present.

I'm interested to see what happens to CVG in its new guise and to see if more new ventures can be encouraged in Connecticut. We need something to help our economy get going again.

Monday, June 13, 2011

Thinking of using social media to build your brand? This week, I was struck by four different approaches - two that seem to work really well, and two that were really poor. Let's see if I can summarize.

The good approaches I noticed are being used by two entrepreneurs who are building brands based on inspiring other women to become successful -- successful in life, successful in business, successful as entrepreneurs. These women are Tory Johnson and Jane Pollak. Tory Johnson is an inspirational speaker who puts on major events. I learned about her through another woman entrepreneur and speaking coach, Ruth Sherman. Jane Pollak is an entrepreneur, speaker and author whom I met over 15 years ago at the Entrepreneurial Women's Network. Jane started out as an artist creating exquisite dyed eggs.

Tory Johnson is using LinkedIn brilliantly. She posts truly excellent questions. She has myriad categories of discussions going on, and she has her many fans and followers posting questions and starting discussions. One of these followers suggested that we all share our professional Facebook pages via that particular LinkedIn conversation. Fabulous idea! As soon as I did this, I had more followers of all sorts. (www.facebook.com/upstartbusinessplanning).

Jane Pollak has a blog connected to her website. The blog is, in turn, connected to her Twitter account. I saw a great topic on Twitter that she had posted -- What I've learned in 3 Years of Blogging. The biggest lesson I learned by reading the blog post was that Jane had learned to be disciplined. She makes sure that she posts on a regular basis, unlike me. I only post when I have the time to think of something that that I believe will be valuable to others. But Jane posts stuff that has lessons for life and starts conversations on a regular basis. This provided inspiration to me. She has learned to create a virtuous circle.

Aren't we all seeking to create virtuous marketing circles that build our brands? Aren't we seeking to start conversations? To me, that is one of the beauties of social media. It's interactive. It can serve to build relationships.

The examples of how not to use social media come from major corporations and a politician. So many corporations are trying to engage their customers in relationships and dialogues, but frankly, the copy almost always sound chirpy or just plain canned and corporate. Too much thought, too much editing, too much corporate speak. It cloys at me. When I see a LinkedIn site or Facebook page that poses a question, and I see that it's from a corporate employee, it's almost always a question that is self-serving. (Entrepreneurs do this, too.)

If we're going to talk to consumers, I believe we need to seek real opinions. We need to listen.

Of course, I know you're going to guess right away about who the politician is. Weiner not only Tweeted lewd photos, his political Tweets on Twitter were always destructive and disruptive. He openly said he was out to be disruptive to the Tea Party's Tweets and activities.

Our nation is in a state now when we need to be trying to work together - not tear each other down. Social media should be used by politicians to get a better pulse on the electorate and to let the electorate know more about where these public officials stand. Let's use social media to come together and solve some problems.

Tuesday, June 7, 2011

I just read a great blog on Forbes.com by Peter Cohan about Groupon ("Memo to SEC: Groupon Has No Competitive Advantage, Stop Its IPO") and why it should not be going public. Basically, the company is not capturing value because it has no competitive advantage. The article goes on from there. This blog has so many really basic business concepts contained in it that I urge anyone with a business, or who is starting a business, to read the blog - more than once. I promise this blog will not make your eyes glaze over.

According to Cohan (and I agree), Groupon is raging ahead on revenue, but is missing the mark on so many other business basics, such as capturing value.

1. Groupon's cost of revenue is too high. For every dollar it brings in, it's spending more than a dollar. No business can grow and prosper with such a business model.

2. Its costs are rising as it grows. That means it's not scaling properly. Costs should become a lower percentage of revenue as you grow. (Ever hear of economies of scale?)

3. The point of most marketing efforts is to generate loyalty. Groupon only rewards people for trying something they normally won't try by offering them a deep discount. That's rewarding trial - with no reinforcement for loyalty.

4. It has no competitive advantage - there are dozens of other daily deal companies out there all offering the same thing.

5. It's not reporting its financial picture properly or accurately. And it's slow in paying its vendors. (See the blog for the details.)

Read Cohan's blog. Study it. Click on the links. You'll gain a lot of wisdom about how not to run a business, which will save save you a lot of trouble as you plan, start or grow your own venture.

Monday, June 6, 2011

One of my former business colleagues was fond of saying, "You only have one chance to make a first impression."

If you're going to be presenting your pitch to potential investors or to people who might buy your goods and services, you'd better be prepared to make a great impression. But how do you do that?

I believe the first step is not to think about yourself. (Thinking about yourself can make you nervous.) Instead, think about your audience. Who are they? What will they be listening for? What do you want them to do afterward? And what can you say or show that will move them toward the action you desire?

The second step is to make your presentation simple. Tell a story with as few slides with as little verbiage as possible. (Think Steve Jobs.) And tell the story from your audience's point of view. You have just invented something that will change their life for the better. Hook your audience in with a question that makes them think about their need for your product.

But the single most important thing you can do is practice. I mean practice saying your talk OUT LOUD. Read it to yourself out loud and with expression. You'll see where you stumble. You'll hear awkward phrases that you can smooth out. But most of all, you'll internalize the talk. Then, you won't have to read your notes or your slides. Say your speech out loud in the car as you drive to the venue. Then, you can look at your audience and engage them.

Watch a TED talk. The TED presenters are the best I've ever seen. Use them as inspiration. They have clearly practiced.

About Me

Owner of Upstart Business Planning: I craft business plans that answer the questions investors ask most often. Co-Author of The Purpose Is Profit: The Truth about Starting and Building Your Own Business and The Startup Roadmap: 21 Steps to Profitability"

Only 1 - 2% of business plans raise funding. 60% of the plans I've done have helped owners raise capital.

I was a founder of and former board member of At Home In Darien (formerly Aging in Place+Gallivant), a nonprofit in Darien, CT.
* MBA from Wharton in Marketing and Finance.